RHB Mudharabah Fund Report - April 2018

Transcription

1. FUND FACTSHEET – APRIL 2018 All data expressed as at 31 March 2018 unless otherwise stated RHB MUDHARABAH FUND This Fund aims to provide a balanced mix of income and potential for capital growth by investing in stocks listed on the Bursa Malaysia or on any other stock exchanges, unlisted stocks and Islamic debt securities and other non-interest bearing assets acceptable under principles of Shariah. The Fund’s activities shall be conducted strictly in accordance with the requirement of the Shariah principles and shall be monitored by the Shariah Adviser of the Fund. INVESTOR PROFILE INVESTMENT STRATEGY This Fund is suitable for Investors who want: • an investment that complies with the principles of Shariah; • a professionally managed portfolio of Shariah-compliant equities, sukuk and Islamic debt securities; • to have a balanced portfolio that provides both income and capital growth; and • to invest in shares but do not have the time to manage their own portfolio. • Up to 60% of NAV will be invested in Shariah-compliant equities; • Minimum of 40% of NAV will be invested in Islamic debt securities, sukuk, Islamic money market instruments and/or liquid assets acceptable under Shariah principles. FUND PERFORMANCE ANALYSIS FUND DETAILS Performance Chart Since Launch* Manager Trustee Fund Category Fund Type Cumulative Performance (%)* 1 Month Fund -3.42 Benchmark -0.60 Fund Benchmark 3 Months -3.61 0.13 6 Months -3.27 2.49 YTD -3.61 0.13 3 Years -0.30 4.82 5 Years -0.14 17.67 Since Launch 59.97 N/A 2016 -7.40 -1.44 2015 7.08 2.79 2014 -12.27 -1.66 1 Year -1.89 3.23 Calendar Year Performance (%)* 2017 Fund 10.31 Benchmark 6.92 Source: Lipper IM Launch Date Unit NAV Fund Size (million) Units In Circulation (million) Financial Year End MER (as at 28 Feb 2017) Min. Initial Investment Min. Additional Investment Benchmark Sales Charge Redemption Charge Annual Management Fee Annual Trustee Fee Switching Fee Redemption Period 2013 6.06 9.65 Distribution Policy *The implementation of GST will be effective from 1 April 2015 at the rate of 6% and the fees or charges payable is exclusive of GST. *For the purpose of computing the annual management fee and annual trustee fee, the NAV of the Fund is exclusive of the management fee and trustee fee for the relevant day. FUND PORTFOLIO ANALYSIS Sector Allocation* Unquoted Sukuk Trading/Services Construction Industrial Products Consumer Products Infrastructure Finance Oil & gas Technology Others Cash 42.20% 25.45% 8.47% 8.22% 5.52% 2.49% 2.24% 1.43% 1.26% 0.55% 2.17% 0% 10% 20% RHB Asset Management Sdn. Bhd. CIMB Islamic Trustee Bhd Balanced fund (Shariahcompliant) Capital Growth and Income Fund 09 May 1996 RM0.8042 RM15.48 19.24 28 or 29 February 1.80% RM1,000.00 RM100.00 50%FBM Emas Shariah + 50%MIB12 mths Islamic FD-i Up to 6.00% of NAV per unit* None Up to 1.50% p.a. of NAV* Up to 0.09% p.a. of NAV* RM25.00 per switch* Within 10 days after receipt the request to repurchase Incidental FUND STATISTICS Historical NAV (RM) 1 Month High 0.8327 Low 0.8042 12 Months 0.8543 0.8042 Since Launch 1.0388 0.4095 Source: Lipper IM 30% Top Holdings (%)* RHBA (AA3) EKVE SDN BHD (AAA) ANIH BHD (AA) MEX II (AA-IS) SPG (AA-) *As percentage of NAV RHB Asset Management Sdn Bhd (174588-x) 40% 50% 6.51 3.45 3.43 3.37 3.27 Historical Distributions (Last 5 Years) (Net) Distribution Yield (%) (sen) 28 Feb 2018 28 Feb 2017 29 Feb 2016 28 Feb 2015 26 Feb 2014 4.0000 4.56 Source: RHB Asset Management Sdn. Bhd. Head Office: Level 8, Tower 2 & 3, RHB Centre, 50400 Kuala Lumpur General Line: 603-9205 8000
2. FUND FACTSHEET – APRIL 2018 All data expressed as at 31 March 2018 unless otherwise stated RHB MUDHARABAH FUND This Fund aims to provide a balanced mix of income and potential for capital growth by investing in stocks listed on the Bursa Malaysia or on any other stock exchanges, unlisted stocks and Islamic debt securities and other non-interest bearing assets acceptable under principles of Shariah. The Fund’s activities shall be conducted strictly in accordance with the requirement of the Shariah principles and shall be monitored by the Shariah Adviser of the Fund. MANAGER'S COMMENTS MARKET REVIEW EQUITY Global stock markets came under pressure in March 2018 on fears over escalating trade tensions. The selling has been most marked in the last 24 hours following President Trump’s announcement that tariffs of United States Dollar (“USD”) $60 billion (“bn”) would be imposed on Chinese imports. Japan’s Nikkei 225 index suffered the steepest declines. Large exporters play a significant part in the Japanese economy and there are concerns that they could be caught up in any United States (“US”)-China trade war. Elsewhere, China and Hong Kong equities have unsurprisingly also borne the brunt of the selling pressure. Eurozone and United Kingdom equities have escaped the worst of the selling. European Union, and others including Canada and Mexico, will be exempt from the new tariffs being applied by the US on steel (25%) and aluminium (10%). The technology supply chain is probably the most global and any trade tariff or restrictive trade practices are likely to be prima facie negative. Hence, for the month of March 2018, technology sector was heavily sold down. FTSE Bursa Malaysia KLCI (“FBMKLCI”) outperformed amid broader market weakness. This was largely driven by big-cap banks (Public Bank and Maybank) and big cap consumer products like Nestle which were sought after by foreigners and locals. The broader small and medium capitalisation stocks have suffered from risk aversion amid risk of trade war and election uncertainty. The FBMKLCI started the month weak, after President Trump announced the steel and aluminium import tariff decision. The FBMKLCI rebounded, closing the day positively (+0.9%) on 12 March 2018, buoyed by consumer and oil and gas stocks as concerns on trade war waned. However, concerns over increased trade protectionism on the sudden dismissal of US Secretary of State, Rex Tillerson who is a free trade advocate led the index to decline on 15 March 2018 (-0.63%). The market recovered on continuous foreign buying over the next few days. On a month-on-month (“MoM”) basis, the index closed slightly higher by +0.39%. Year-to-date (“YTD”), the FBMKLCI is the best performing index. On the economic front, the headline inflation rate slowed to 1.4% year-on-year (“YoY”) in February 2018 (+2.7% in January 18) – the lowest in 16 months. Additionally, Bank Negara Malaysia (“BNM”) raises 2018 growth forecast to 6% from 5.5%. FIXED INCOME In March 2018 Federal Open Market Committee (“FOMC”) meeting, the Federal Reserve (“Fed”) delivered a no surprise hike as it raised Fed funds rate by a quarter-point to a target of 1.5% to 1.75%, maintaining the expectation for a total of three hikes this year. The Fed also upgraded its economic assessment forecasting higher Growth Domestic Product (“GDP”) growth this year with little change on the inflation expectations. Dominating investor concerns for the month however was the stability of global trade and its possible repercussions on global trade and markets. This started in the beginning of the month when United States (“US”) President signing an order imposing tariffs on aluminium and steel imports to the US and few weeks later announced plan of 25% tariffs on Chinese imports in response to the US Trade Representative’s report that concluded China’s unfair trade practices pressured transfer of technology to China. Concerns on trade wars led to a flight to safe heaven and eventual rally in United State Treasuries (“UST”) especially on the long-end. UST 2-, 5-, 10- and 30-year closed the month at 2.27% (February 2018: 2.25%), 2.56% (2.64%), 2.74% (2.86%) and 2.97% (3.12%) respectively. Over in Malaysia, Bank Negara Malaysia (“BNM”) maintained Overnight Policy Rate (“OPR”) at 3.25% in its March 2018 Monetary Policy Committee (“MPC”) meeting as it sees the current degree of monetary accommodativeness is consistent with its policy stance. Headline Consumer Price Index (“CPI”) slowed in February 2018 to 1.4% YoY, lower than estimates of 1.9% (January 2018: 2.7%), the lowest seen in 16 months as transport, communication and clothing prices declined. Malaysian Government Securities (“MGS”) rallied supported by the rally in UST and a stronger Malaysian Ringgit (“MYR”) performance as the MYR gained +1.37% closing the month at 3.8635/USD. The 3-, 5, 7-, 10-,15-, 20- and 30-years MGS last traded at 3.43% (February 2018: 3.40%), 3.54% (3.62%), 3.83% (3.95%), 3.94% (4.03%), 4.41% (4.46%), 4.54% (4.61%) and 4.79% (4.81%) respectively. Government Investment Issue (“GII”) followed the same trend with the 3-, 5-, 7-, 10-, 15-, 20- and 30 years closed at 3.61% (February 2018: 3.59%), 3.82% (3.88%), 4.00% (4.08%), 4.15% (4.17%), 4.55% (4.53%), 4.77% (4.78%) and 4.90% (4.95%) respectively. On economic data front, export growth in MYR terms jumped to 17.9% YoY in January 2018 while import accelerated to 11.6% YoY. This resulted in the widening of the trade balance to RM9.7 billion for January 2018. Malaysia’s international reserves as at end February 2018 was reported at USD103.7 billion, unchanged from its level the previous month. This is sufficient to finance 7.2 months of retained imports and 1.1 times short term debt. The foreign holdings of Malaysian bonds/sukuk market saw outflows of –RM3.9 billion for the month of February 2018 (inflows of +RM4.5 billion in January 2018). This brings the total foreign holdings in MGS to 45.4% (January 2018: 45.7%) and total foreign holdings of government bonds/sukuk at 27.5% (January 2018: 28%). The government of Malaysia has tabled a supplementary budget with additional allocations of RM7.12 billion in addition to the RM260.8 billion allocated for Budget 2017. Despite the supplementary budget, we opine this would not add to the overall budget deficit of RM39.9 billion (3% of GDP) on possible upsides to the revenue in 2017. We saw a combined issuances of RM13.1 billion in January 2018 bringing primary issuances total of RM29.6 billion in the first quarter of 2018. Among the primaries is Prasarana Malaysia Berhad (GG) issuing a further RM3.0 billion in 5 tranches with maturities of 7, 10, 15, 20 and 25 years with coupons of 4.39%, 4.62%, 4.94%, 5.12% and 5.25% respectively. This coupons spread between 53-70 bps over corresponding MGS benchmarks. Fortune Premier Sdn Berhad (AA) issued additional RM250 million from its RM3 billion programme guaranteed by IOI Properties Group Berhad. The 5 year sukuk was issued at coupon of 4.80%, +122 bps over MGS benchmark. Al-Dzahab Assets Berhad issued 3 tranches from its AAA Class A sukuk murabahah programme, 1 tranche from its AA3 Class B programme and a final tranche from its unrated Class C programme with a total issuance of RM206.5 million. Gamuda Berhad (AA3) also tapped the market for a further RM400 million 5 year sukuk at 4.785%, a 139.5bps spread against MGS benchmark. Over in AAA space, Danga Capital Berhad issued RM2 billions of 15.5 year sukuk with coupon of 5.02%. Another AAA issuance was Putrajaya Bina Sdn Bhd (PBSB) issuing RM600 million sukuk in 4 tranches of 3, 5, 7 and 10-year at 4.34%, 4.50%, 4.56% and 4.77% respectively. MMC Corporation (AA-) also issued RM1 billion IMTN with a coupon rate of 5.70%, 215 bps spread over the corresponding MGS benchmark. MARKET OUTLOOK AND STRATEGY Equity With US midterm elections scheduled for November 2018, there is increased incentive for President Trump to deliver on campaign pledges. There is therefore more to come. President Trump has ordered the US Trade Representative to propose a list of product tariff increases and to consider further tariffs on goods from China. Malaysia is vulnerable in the event of a protracted trade war. Gross export accounts for approximately 73% of the Malaysian Gross Domestic Product (“GDP”) in 2017. Meanwhile, electronics and electrical (“E&E”) goods account for 37% of Malaysia’s export. In the event of a full-blown trade war between the US and China, Malaysia would likely be adversely affected, particularly the E&E sector. As for small and medium capitalisation stocks, present broad market weakness presents accumulation opportunity but caution and patience are required. Amid trade war uncertainty and rising interest rate, equity risk premium is unlikely to get any lower. As such, the days of buying high and selling higher on valuation expansion are over. We will continue to focus on fundamentals and valuation. Fixed Income External factors will continue to drive bond yields higher in the near term but we see support for local bond markets as BNM kept rates steady at 3.25% and we reckon policymakers will not rush for another rate hike this year unless global conditions improve or domestic price conditions improve. On top of that, Malaysian bond/sukuk market is in a better position to withstand outflow risks as it is one of the deepest in the region with support of strong onshore real money interest. On that note, we are still comfortable to tactically add portfolio duration as we see foreign and local confidence towards MYR assets remain robust alongside steadily higher oil prices. DISCLAIMER: Based on the fund’s portfolio returns as at 15 March 2018, the Volatility Factor (VF) for this fund is 8.1 and is classified as “High”. (source: Lipper) “High” includes funds with VF that are above 8.0 but not more than 10.6 (source: Lipper). The VF means there is a possibility for the fund in generating an upside return or downside return around this VF. The Volatility Class (VC) is assigned by Lipper based on quintile ranks of VF for qualified funds. VF is subject to monthly revision and VC will be revised every six months. The fund’s portfolio may have changed since this date and there is no guarantee that the fund will continue to have the same VF or VC in the future. Presently, only funds launched in the market for at least 36 months will display the VF and its VC. The VC referred to was dated 31 December 2017 which is calculated once every six months and is valid until its next calculation date, i.e. 30 June 2018. A Product Highlights Sheet (“PHS”) highlighting the key features and risks of the Fund is available and investors have the right to request for a PHS. Investors are advised to obtain, read and understand the PHS and the contents of the Master Prospectus dated 15 July 2017 and its supplementary(ies) (if any) (“the Master Prospectus”) before investing. The Master Prospectus has been registered with the Securities Commission Malaysia who takes no responsibility for its contents. Amongst others, investors should consider the fees and charges involved. Investors should also note that the price of units and distributions payable, if any, may go down as well as up. Where a distribution is declared, investors are advised that following the issue of additional units/distribution, the NAV per unit will be reduced from cum-distribution NAV to exdistribution NAV. Any issue of units to which the Master Prospectus relates will only be made on receipt of a form of application referred to in the Master Prospectus. For more details, please call 1-800-88-3175 for a copy of the PHS and the Master Prospectus or collect one from any of our branches or authorised distributors. The Manager wishes to highlight the specific risks of the Fund are stock market risk, individual stock risk, liquidity risk, issuer risk, interest rate risk, credit / default risk and shariah specific risk. These risks and other general risks are elaborated in the Master Prospectus. This factsheet is prepared for information purposes only. It does not have regard to the specific investment objectives, financial situation and the particular needs of any specific person who may receive it. Past performance is not necessarily a guide to future performance. Returns may vary from year to year. RHB Asset Management Sdn Bhd (174588-x) Head Office: Level 8, Tower 2 & 3, RHB Centre, 50400 Kuala Lumpur General Line: 603-9205 8000